Unfair but balanced commentary on tax and budget policy, contemporary U.S. politics and culture, and whatever else happens to come up

Thursday, February 23, 2012

Assessing Romney

I have always understood the case for electing Mitt Romney, when stated plausibly rather than in the idiotic (because lowest-common-denominator) terms of public political discourse generally, as follows: He’s a smart and ambitious guy who can analyze issues dispassionately; just as he wants to become president, so he would want to be viewed as a successful one; hence, he not only has the ability to make good decisions from a national welfare standpoint, but to a degree would have the incentive to make them once in office.

I happen to disagree with this (although it might have had a chance of being reasonably true had he been elected president in the very different circumstances of the 1950s through the 1980s). Part of the problem I see is that he is irrevocably committed politically to what I consider a number of bad ideas, such as the views that deregulating the financial sector, cutting taxes for high-income people, and doing much less to help poor people (both the young and the old) are generally the way to go. He also appears to be close to committed to starting a ludicrously misguided war with Iran, that could very well work out, for both the U.S. and the world, about a thousand times worse than our recent adventures in Afghanistan and Iraq.

Is he capable of understanding what I consider the serious flaws with these ideas? Well, probably – I didn’t say that he was irrevocably committed to these ideas intellectually (although he might be – I just don’t know), but that he is irrevocably committed to them politically. And a lot of other things that he almost surely doesn’t believe in are probably now on his list of irrevocable political commitments, such as pandering to the Republican base on social issues in various ways (although I imagine that, no less than Reagan or Bush I, he won’t actually try to do anything with these issues). Of course, the very fact that his lack of core convictions has been so thoroughly exposed gives him less political freedom than he would otherwise have to continue shape-shifting; he’s already played that card too many times to be able to continue playing it.

OK – again, the case for Romney rests on the claim that, if he has the power to make decisions and has the right incentives, he will make the right decisions. Unfortunately, even if he is elected president, we will never get to learn if this is true. He won’t have the power, and he won’t have the right incentives. Grover Norquist recently raised eyebrows at a big conservative meeting by stating bluntly that the virtue of electing someone like Romney, from his standpoint, is that the electee would have to do what he was told by extremists in Congress and the base. I suspect that this is at least 90 percent true.

Plus, because of Romney's political weakness (even if elected) and the pressures he’ll face from both the far right and the Democrats, he generally will not have the right incentives. An example is the war with Iran, which could well be a political net benefit for him (as Iraq was for Bush II, for quite a while) even if it is self-evidently disastrous for the U.S. and the world. The rally-round-the-Commander in Chief syndrome could well do great things for him, especially if the Iranians exact severe retaliatory consequences on us. He is smart enough to know, and perhaps dispassionate enough to value, the fact that even disaster could pay off for him politically.

So the case for Romney is essentially that, if we were electing a dictator for a finite term, with the chief payoff being his public reputation when the term was over (and in particular once all the dust had settled), there’s an argument that he’d be a good choice. But that’s not the choice we face, and this is a key reason (though not the only one) why I have a very negative view of his candidacy.

Case in point: the “tax reform” document that he released yesterday. I will comment on this, when I get a chance, in my next post.

About Me

I am the Wayne Perry Professor of Taxation at New York University Law School. My research mainly emphasizes tax policy, government transfers, budgetary measures, social insurance, and entitlements reform. My most recent books are (1) Decoding the U.S. Corporate Tax (2009) and (2) Taxes, Spending, and the U.S. Government's March Toward Bankruptcy (2006). My other books include Do Deficits Matter? (1997), When Rules Change: An Economic and Political Analysis of Transition Relief and Retroactivity (2000), Making Sense of Social Security Reform (2000), Who Should Pay for Medicare? (2004), Taxes, Spending, and the U.S. Government's March Towards Bankruptcy (2006), Decoding the U.S. Corporate Tax (2009), and Fixing the U.S. International Tax Rules (forthcoming). I am also the author of a novel, Getting It. I am married with two children (boys aged 24 and 21) as well as three cats. For my wife Pat's quilting blog, see Patwig’s Blog.